The Monday Report – 22 June 2026

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This story features BHP GROUP LIMITED, and other companies.
For more info SHARE ANALYSIS: BHP
The company is included in ASX20, ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

Good Morning,

The Australian market rose 24 points, or 0.38%, to 8828.70 last week.

On Friday, the ASX200 declined by -0.9%, led by materials, down -4.1%, while healthcare outperformed, gaining 3.5%.

CSL ((CSL)) is doing an heroic phoenix performance, rising 7.6% on the day.

BHP Group ((BHP)) slumped -5.6% on Friday after announcing further cost overruns and delays at the Jansen Stage 2 potash project in Canada.

US markets were closed on Friday.

ANZ Bank, Australian Morning Focus, extract

It was a quiet end to the week, with US markets closed for a federal holiday. 

Equities were weaker after the US and Iran delayed talks scheduled to take place in Geneva following an escalation between Israel and Hezbollah. 

It was later announced that a ceasefire between Israel and Hezbollah has been agreed. The EuroStoxx50 closed down -0.5%, while the FTSE100 fell -0.4%. 

WTI rose 0.6% to US$77.5/bbl and gold was at US$4,156/oz. 

Over the weekend Iranian media announced the Strait of Hormuz was closed again and that Iran had halted peace talks as Trump threatened renewed military escalation. The number of ships currently moving through the Strait is very unclear, particularly since many ships leave their transponders turned off. 

Following Fed Chair Warsh’s first press conference, we expect the Federal Reserve will prioritise the inflation side of its dual mandate given its “unambiguous and unanimous” commitment to meeting the 2.0% inflation target. 

We think the Fed’s reaction function has hardened and the bar for interest rate cuts is higher than it was previously. We have adapted our fed funds forecast path to reflect this, and think the Fed will remain on hold until Q2 next year, when we expect a -25bp rate cut. 

We think that will be followed by another -25bp cut in Q3 2027 to leave the target range 50bp lower at 3.00-3.25%. 

While unanimous in its commitment to bring inflation back to target, the Federal Open Market Committee is split amid current uncertainty as to the appropriate path for fed funds over the remainder of this year.

Nine of 18 members who submitted interest rate forecasts thought rates should be higher by year-end. Nine did not. 

This week, the focus will turn to Fed speakers. Fed Governor Waller speaks on Monday and NY Fed President Williams speaks on Thursday. We will be trying to detect where the split on the FOMC lays. 

Our assessment is the Board of Governors and NY Fed President Williams have a higher bar to raising interest rates than the regional Fed Presidents. We think they are part of the cohort that sees no rate hikes this year. 

Australian data this week.

It is a big week on the Australian data calendar with the release of the May monthly CPI, labour force survey and monthly household spending data. 

On the CPI, we expect trimmed mean inflation to rise 0.3% m/m (in line with consensus).

On the labour force, we expect the unemployment rate to edge down to 4.4% and for employment to increase by around 20k (consensus is looking for a 4.4% unemployment rate and a 30k rise in employment).

The Bull Bear Report, Lance Roberts, extract

For a week that delivered a hawkish regime change at the Fed and the largest options expiration in history, the tape held up remarkably well.

All four major indices finished green. The Nasdaq Composite led, up 2.43% to 26,517.93, with the Russell2000 gaining 1.22% to 2,979.77, the S&P500 adding 0.93% to 7,500.58, and the Dow rising 0.71% to 51,564.70.

That is not what most desks would have drawn up after Wednesday.

The path mattered more than the destination. Stocks ripped on Monday after the US and Iran announced a deal to end hostilities, with the S&P jumping 1.65% and the Nasdaq surging by more than 3%.

They handed much of it back on Wednesday when Kevin Warsh used his first meeting as Fed Chair to drop forward guidance and reveal a dot plot in which nine of eighteen officials now pencil in a rate hike this year.

Then Thursday’s record quadruple-witching expiration cleared, chips and cyclicals firmed, and the indices closed the holiday-shortened week higher.

Markets were dark on Friday for Juneteenth.

The cross-asset board did the explaining. The dollar was the standout. A hawkish Warsh and a market now pricing a rate hike by October lifted the dollar index to roughly 100.7, its highest since May 2025.

Gold fell about -3.5% on the week to near US$4,175 as the firmer dollar and higher real yields sapped the metal. Treasury yields jumped on Wednesday’s dots, with the 2-year ending at 4.19% and the 10-year at 4.46% after easing slightly on Thursday.

Crude held its ground near US$75.70, but energy equities lagged as the US-Iran memorandum drained the last of the geopolitical premium, and pump prices finally slipped below US$4 a gallon for the first time since March.

US-Iran update: Geography still matters, Western Asset, Robert O. Abad (Franklin Templeton)

Iran announced today it was closing the Strait of Hormuz again, citing alleged violations of the recently signed memorandum of understanding by the United States and Israel.

In our previous update, we emphasized the memorandum should not be interpreted as the end of the confrontation between the countries. Its purpose was to create a negotiating window and establish a process for addressing much more difficult issues at a later date, including sanctions, regional security arrangements and proxy conflicts.

The latest developments highlight the difference between a diplomatic framework and a durable outcome. The Trump administration understandably characterized the memorandum as a major breakthrough and a sign that the conflict was moving toward a conclusion with markets largely embracing that interpretation.

The latest dispute also underscores a point that often gets lost in the headlines. Military operations can degrade capabilities, destroy assets and alter the balance of power, but they can’t change geography.

Even under significant economic and political pressure, Iran retains the ability to create uncertainty around one of the world’s most important maritime chokepoints.

Stepping back and looking at the bigger picture, the Gulf states, the Red Sea, Lebanon, Syria, Iraq and the wider Middle East remain deeply interconnected. Events over the past several months have shown how quickly tensions in one part of the region can spill into another and how difficult it is to isolate individual conflicts from the broader strategic landscape.

In our view, the most important takeaway has very little to do with the reaction in oil prices or the latest shipping statistics.

The memorandum reduced the risk of an immediate crisis, but it didn’t remove the underlying sources of instability. If anything, the events of the past several days reinforce the view that geopolitical tension in this region is likely to remain a recurring feature of the investment landscape rather than a temporary interruption.

Corporate news in Australia:

• The AFP launched an investigation into WiseTech Global’s ((WTC)) founder Richard White after a complaint on human trafficking allegations
• Bupa to acquire Partnered Health, expanding its Australian clinic network and primary healthcare footprint
• Ithaca has acquired bankrupt Queensland coal miner Vitrinite for more than $200m, consolidating its position in the Australian coal sector
• TPG Capital has agreed to sell Cocobella to Danone in a deal valued at almost $2bn
• MediaWorks is reportedly nearing a management buyout led by chairman Barclay Nettlefold
• Qscan sale process has stalled as bidders and vendors remain apart on valuation expectations 
• Healthscope sale delayed after a consortium extended due diligence on the proposed hospital acquisition 
• Dexus Convenience Retail REIT ((DXC)) increased its buyback target to 5%, citing valuation support and capital management initiatives 
• Visionary Machines is considering an ASX listing following a pre-IPO capital raising that valued the company at $40m 
• La Trobe Financial has launched a $750m refinancing following Brookfield’s investment in the business
• FDC Construction is targeting a $400m ASX IPO at a valuation of approximately $970m and plans to offer a dividend to investors 

On the calendar today:

-FISHER & PAYKEL HEALTHCARE CORPORATION LIMITED ((FPH)) ex-div 27.05c

-METCASH LIMITED ((MTS)) FY26 earnings report

FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/

The Australian share market over the past thirty days…

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